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Budget Cuts Pass by a Slim Margin

By Jonathan Weisman
The Washington Post
Thursday 02 February 2006

Poor, elderly and students to feel pinch.

The House yesterday narrowly approved a contentious budget-cutting package that would save nearly $40 billion over five years by imposing substantial changes on programs including Medicaid, welfare, child support and student lending.
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State-led efforts to force deadbeat parents to pay their child support - to be curtailed.
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"This bill is Exhibit A for special interests and lobbyists writing legislation behind closed doors at the expense of the ordinary citizen," Rep. John D. Dingell (D-Mich.) said yesterday.

But with the federal budget deficit expected to rise again this year, to around $360 billion, Republicans implored their members to take what Rep. Adam Putnam (R-Fla.) called "this first step toward long-term, fiscal discipline and fiscal health for our government."

The impact of the bill on the deficit is likely to be negligible, slicing less than one-half of 1 percent from the estimated $14.3 trillion in federal spending over the next five years. As the House debated the budget-cutting measure, the Senate moved to begin final negotiations with the House on a package of tax cuts and extension of expiring tax cuts that could cost up to $60 billion over five years, more than negating the savings from the budget bill.

"I do not know how anyone can say with a straight face that when we voted to cut spending in December to help achieve deficit reductions, we can now turn around a short while later to provide tax cuts that exceed or cancel out the reduction in spending," Sen. George V. Voinovich (R-Ohio) said yesterday, as the Senate took up a procedural motion that would allow tax-cut negotiations to begin. "We cannot afford these tax cuts."

Washington Post

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Originally posted by Lyrhawn:
Bush would argue that these tax cuts are what is driving the economy, which increases are revenue to pay off more of the deficit.

Still, I see absolutely nothing concrete or even paper thin, to show that we're anywhere near on track to cut the deficit in half in even the next ten years.

These tax cuts, which I really don't see as a major benefit to the lower classes, are going to hurt a lot more than they will help. The deficits are only going up, and the only way to pay them down is with more money, not less.

Talk about needing more math and science teachers, I think Bush needs to take a remedial math class himself.

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The $70 billion comes on top of an estimated $320 billion spent since 2001 on the wars in Iraq and Afghanistan, according to the OMB. The cost of U.S. military operations -- excluding procurement of equipment -- is running at $4.5 billion a month in Iraq and $800 million in Afghanistan, said Defense Department spokesman Bryan Whitman.

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Posted by DarkKnight (Member # 7536) on :
 
Let's keep in mind who actually pays the taxes:
The top 50% of wage earners pay 96.54% of All Income Taxes
The Top 25% of wage earners pay 83.88% of all Income Taxes
The Top 1% of wage earners pay 34.27% of all Income Taxes
My guess is that you want your taxes cut, and people who make more than you should not have their taxes cut because they are rich. Well, the rich are the ones paying most of the taxes.
The problem with 'tax breaks for the rich' is that if we reduce everyone's tax burden by 1% the top wage earners will get a bigger dollar reduction than the low end wage earners. The percent reduction is the same.
Of course if you really want to help the government out you can overpay your taxes and donate the money.
 

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Posted by fugu13 (Member # 2859) on :
 
DK: of course, many of the recent tax cuts have not been some across the board equitable percentage. There've been equitable cuts that everyone has received the benefits of (tax bracket adjustments, for instance), then additional cuts that can only really be taken advantage of by wealthy people.
 

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Posted by DarkKnight (Member # 7536) on :
 
Fugu, you are correct. The additional cuts that are taken by the wealthy in the highest tax brackets can only be taken by the wealthy because they are the only ones who pay them. You can't cut taxes for people who don't pay taxes. In other words the wealthy are forced to pay taxes that no one else has to. The tax percent goes up the more you make so the wealthy have to pay a higher percent in taxes because they have to pay taxes that we don't (unless of course you are wealthy as well).
 

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Posted by fugu13 (Member # 2859) on :
 
Heh. Yep, forced to in exactly the same way that those with income are forced to pay a tax those without income aren't forced to pay. Its so unfair .
 

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Posted by DarkKnight (Member # 7536) on :
 
Not a great analogy since those two people are very different. If you have no income you have nothing to tax so that is fair. Just like you shouldn't have to pay cigarette taxes if you don't smoke.
(EDIT) Or maybe they do pay taxes but 15% of zero is zero so it all works out
 

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Posted by Lyrhawn (Member # 7039) on :
 
Oh boo hoo. I'm sorry, but with all off shore tax shelters, and holes built into the tax code, they don't pay what they should anyway. I'm sorry that they have trouble living on only twenty or thirty million dollars a year, I realize it must be tough, what with the rising price of 80 foot yachts and all.

But this country is in financial trouble. Of course the rich folk don't care, if the economy tanks, they'll survive. But really, if it's about the safety of their nation and the fiscal security for the future of their children, you'd think they wouldn't complain about taking a bit more of the money they'll never miss anyway.

Hell, I'll settle for forcing people who use offshore shelters and tax holes to actually pay those taxes. They'd probably still call that a tax increase but it wouldn't be.
 

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Posted by Celaeno (Member # 8562) on :
 
I have a question that only kind of relates to this topic...have the revised fourth quarter GDP numbers come out yet?
 

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Posted by Synesthesia (Member # 4774) on :
 
Actually, they really won't survive.
If these folks are rich because of the products they manufacture, and if a great deal of jobs get outsourced, thus making it impossible for people to afford their services, it's only a matter of time before their money dries up...
So it really is somethign they should be concerned with. It doesn't seem financially responsible.
 

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Posted by TomDavidson (Member # 124) on :
 

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If you have no income you have nothing to tax so that is fair. Just like you shouldn't have to pay cigarette taxes if you don't smoke.

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This is actually why I support the idea of a wealth tax.
 

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Posted by Silkie (Member # 8853) on :
 

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Originally posted by TomDavidson:

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If you have no income you have nothing to tax so that is fair. Just like you shouldn't have to pay cigarette taxes if you don't smoke.

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This is actually why I support the idea of a wealth tax.

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• When it was wealthy people/families (and not wealthy corporations) running the world, in some of the higher social elevations there was a thread of 'noblesse oblige' taught to the up and comings. Socially prominent wealthy people donated to the arts, and many fostered some sort of long term pension plans for their workers. In order to get the best people, companies offered good benefit packages. Of course many of those benefits began because of organized labor, (the five day 40 hour week, for instance) but still it was usual for companies to have benefits.
• In today's corporate world the workers are not valued nearly as much. Corporatioons are impersonal. So many people in today's workplace are temporary workers, or part time with no or few benefits. It's all about the bottom line, and if it doesn't create a profit then it is discarded. Social responsibility seems to have become passe. The divide between the rich and the poor is growing, and in many places poor people don't have access to things taken for granted by the upper crust: good health care, a home of their own, a job that will be there for them in the forseeable future.